Many of today’s renters find themselves stuck between the proverbial rock (rising rents) and a hard place (down payments and closing costs). Average monthly rent payments are already twice as big as monthly mortgage payments, and rental rates are still rising. Yet potential homeowners feel buying a home is out of reach, with 68% of renters citing the down payment as the biggest obstacle. Put simply, a smaller requirement for upfront cash can help renters make the leap to homeownership.
This is the primary reason PrimeLending launched the NeighborhoodEdge® program to provide financial assistance to qualified homebuyers in the form of closing cost credits. PrimeLending’s NeighborhoodEdge® program provides up to $1,500 in closing cost assistance for qualified first-time homebuyers based on their income and location of the property they want to purchase.
“Fifteen hundred dollars may not sound like a lot, but for a lower income household, this amount can provide a great deal of assistance,” said Christina Arias, senior loan originator for PrimeLending (NMLS: 222469).
Consider the situation for two of Arias’ clients, a married couple with kids who have steady employment at a fast food restaurant and who have managed to save $4,000 to put toward buying a home for their family.
“Their savings, coupled with down payment assistance and PrimeLending’s NeighborhoodEdge®, can help make the dream of homeownership a reality for this family by making it more affordable for them to get into a home, either by helping them meet their down payment goal or just giving them a little extra financial cushion – money they can put toward buying furniture or paying their utilities,” said Arias.
Programs like this open the door to homeownership to qualified borrowers with sufficient credit, and who generally have the cash flow and ability to make monthly payments.
“In an extremely tight housing market, such as we’re currently seeing, it’s important now more than ever to provide low-to-moderate income families with the tools and resources to help them succeed in homeownership,” said Steve Thompson, President of PrimeLending. “A substantial number of buyers can’t afford to purchase a modestly priced home often times because of the upfront costs. NeighborhoodEdge® is a way to help lessen this obstacle for families, while enabling communities to increase their homeownership rates.”
The NeighborhoodEdge® program was born out of a larger discussion within the company on ways to make homeownership more accessible to everyone. While homeownership is often the largest source of household wealth for many individuals, financial gain isn’t the only reason to aspire to owning a home. Decent and affordable housing has tremendous social and economic benefits that effect the health, education and welfare of families and communities.
Since launching the NeighborhoodEdge® closing cost assistance program in 2015, PrimeLending has helped provide more than $1 million in closing credits to homebuyers.
“Homeownership is in the nation’s interest when it can bring stability to families, new vitality to communities, bridge the wealth gap and contribute to overall economic growth,” said Thompson. “At PrimeLending, our goal is not just to help families get into homes, but to do right by them. We want people to succeed in homeownership.”